As third-party energy suppliers, technology firms and companies begin to enter the distribution space, electric utilities are increasingly faced with the need to move beyond traditional services and business models. New competitive pressures and changing customer expectations are leading utilities to explore customer-centric business opportunities that bring innovation to the ways in which electricity is traditionally produced and consumed, and create new sources of revenue.
This paper discusses five competitive forces that are influencing the electricity industry and explores how the distribution system and markets could evolve as DER adoption continues to increase. A set of four utility business models are evaluated in relation to customer demographics, provided services, and methods for deriving revenue from non-traditional services. Several relevant case studies are also discussed to demonstrate the practical application of the four business models to the industry today.
Distributed energy resources (DER), Distribution markets, Utility of the future, Grid modernization, Business models, Solar, Energy storage, Internet of things, Microgrid, DER integration, Distributed markets